Affordable Housing Financing Plan (AHFP)
Housing Standing Committee
February 25, 2025
Government Code Section 54957.5
SB 343 Item Agenda: 02/25/2025 SP HSC Item 2
Staff Recommendation
Staff recommends the Housing Standing Committee to
consider and provide feedback for the proposed Affordable Housing Financing Plan (AHFP) that would:
Guide the City’s biannual housing funding priorities in relation to existing housing goals, policies, programs, and funding availability.
Plan Goals
• Biannually outline housing funding priorities
• Create three financing pathways: expected (primary), surplus, and limited based on funding availability scenarios
• Provide structure and implementation support to existing policies such as the City’s Housing Element
• Provide strategies to stabilize housing fund revenue across fiscal years
Background
• City Council Study Session in 2021 on a housing programs framework
• Need for financial planning of the City’s affordable housing funds to strategically align spending with housing priorities • Growing need for financial strategy following creation of the Commercial Linkage Fee in 2018
• Commercial Linkage Fee generates considerable but fluctuating revenue; “Boom or bust” cycles tied to commercial real estate market • State/Federal regulatory requirements and funding programs are becoming stricter with funding parameters and local match requirements Housing Element
Alignment
• Every project targeted for funding cites the
Housing Element policy it furthers
• Many programs such as our nonprofit
housing programs are required by our
Housing Element (AFFH requirements)
• Plan provides pathways for various
financial scenarios to meet Housing
Element obligations
Plan Structure
Research Conducted
• Biannual plan managing funding commitments to projects and programs. • Established by ordinance in 2023 to guide spending of the City’s $970M Housing Levy funded by property tax levies • Provides guidelines for administering loans and grants • Sets administrative policy and includes reporting requirements Seattle Housing Levy Administrative and Financial Plan
• Directive from the Mayor to the Housing Leadership Council and Housing Office to develop a funding strategy to assist implementation of the City’s 2022 Housing Element Update • Primarily focused on providing policy recommendations increase funding or make existing funding more efficient. •Outlines funding availability and funding projections. • Does not set policy or include reporting requirements San Francisco Affordable Housing Funding and Financing Recommendations Report Plan Components
Current and Projected Funding
Funding and Policy Parameters
Two Year Expected Funding Plan
Surplus/Limited Scenario Pathways
Balances and Average Revenues
Fund Source Current Balance Encumbered Balance Unencumbered Balance
Annual Revenue
Funds
Commercial Linkage
(823)
$13,384,082 $4,235,408 $9,148,674 $5,655,142
Affordable Housing
Trust Fund (205)
$550,423 $441,693 $49,423 $208,552
LMI Housing Asset
Fund (241)
$2,550,143 $1,179,113 $1,371,030 $ 463,127
Grants
CDBG $424,978 $424,252 $726 $531,486
PLHA $338,000 $338,000 $0 $309,897
LHTF $2,400,000 $0 $2,400,000 Competitive Grant
IIG $28,817,500 $28,817,500 $0 Competitive Grant
PIP $890,000 $0 $890,000 Competitive Grant
Funding and Policy Parameters I
• Must impactfully further Housing Element / General Plan priorities • Legal obligations take primacy
• State/Federal grants are often prescriptive of fund usage and carry nuanced policy and administrative requirements
• Examples:
• Local Match Requirement (PIP, LHTF)
• Meeting precise definitions of terms like “Infill” or “National Objective” (IIG, CDBG) • Expenditure Deadlines (all)
• Local funds generally flexible; Fund 241 (former RDA) must be primarily used towards ELI and no households above 80% AMI • Incorporates market conditions & risk
factors conservative funding
targets to maintain adequate cash
flow
• Considers year-to-year revenue
fluctuations
• Does NOT set new policy;
implements existing policy
• Does provide recommendations for
limited/surplus scenarios
• Annual review but no monitoring
requirement; relies on pre-existing
requirements set by guiding policies
Funding and Policy Parameters II
Funding Plan: Production Targets
Program Funding Source Funding Target Target
Population/Geograp
hy
HE Goal / Program Projects
City-Led Acquisition
and/or Housing
Development
823, PLHA $450,000 Citywide Programs CRT 4.1
and 4.6
718 Linden
rehabilitation
City Financing For
Developer-Led
Affordable Projects
LHTF, PLHA, IIG, 823,
241
$35,000,000 Citywide Programs CRT 4.2
and 4.6
1051 Mission, Road,
500 and 522 Linden
Regulatory / Zoning
Updates to
Accelerate Housing
Production
Planning fees
charged to property
owners / developers.
HCD also releases
grants such as SB2 /
LEAP during HE
planning cycles to
absorb local costs
NA Citywide Goal 2 (Creation /
Facilitation) and Goal
3 (Remove
Constraints)
Zoning and policy
updates to fulfill
General Plan and
Housing Element
goals and programs
such as updating our
density bonus
ordinance
Funding Plan: Preservation Targets
Program Funding Source Funding Target Target
Population/Geograp
hy
HE Goal / Program Projects
Acquisition of
existing but at-risk
affordable housing
properties, such as
SROs
PIP, 823 $1,780,000 (E)LI households,
citywide with focus
in low and moderate
opportunity areas
Program CRT-9.2 –
Preserve naturally
occurring affordable
housing
SRO Property
Acquisition with PIP
funds and 823 (local
match)
Anti-Displacement
Roadmap
270 (non-housing),
823, PBF
$415,000 Citywide Program EQ-3.2 –
Conduct a public
hearing to consider
an antidisplacement plan
Community Action
Committee
meetings, SRO /
Mobile Home
Conversion
Ordinances
Funding Plan: Protection Targets
Program Funding Source Funding Target Target
Population/Geogra
phy
HE Goal / Program Projects
Emergency Rental
Assistance
241 $180,000 annually (E)LI households,
citywide with focus
in low/mod
opportunity areas
Program EQ-8.5 –
Continue the
Rental Assistance
Pilot Program
City-funded
emergency rental
assistance
administered by
YMCA
Nonprofit Housing
Programs (legal
aid, minor home
repair, etc.)
CDBG $285,000 annually Citywide with
emphasis on areas
of higher
displacement risk
Goal 1: Equity City funding to
community
partners such as
Project Sentinel
(fair housing
services) and
Samarian House
(emergency
shelter)
Alternate 1: Limited Financing Pathway
Evaluation Criteria
1) State and Federal statutory requirements
2) Regulatory and grant agreement
obligations
3) Highest impact for disadvantaged and
historically underserved communities
4) Project viability and delivery
5) Highest impact on progressing housing
priorities in General Plan and Housing
Element
Example Actions
• Reduce property acquisitions and city-led
financing programs
• Reduce non-obliged funding to non-profit
housing services
• Explore the creation of new funding sources
• Evaluate necessity for proposing funding
allocation from non-housing funds (last
resort)
Alternate 2: Surplus Financing Pathway
Evaluation Criteria
1) Highest impact for disadvantaged and
historically under-represented
communities
2) Project viability and delivery
3) Highest impact on progressing housing
priorities in General Plan and Housing
Element, with consideration of balancing
funding across the 3Ps
Example Actions
• Pursue rehabilitation of 226-246 Grand
Avenue
• Create a revolving loan and/or reserve fund
that could help stabilize annual funding
availability
• Consider policies of interest to City
Council, such as establishing a tenant right
to council Program
Questions for HSC
• Which strategies should be
prioritized?
• Interest in establishing a revolving loan
fund and/or reserve fund to stabilize
the Commercial Linkage Fund?
• Leveraging the Community Benefit Fee
for affordable housing? Putting out a
NOFA that awards multi-benefit
projects?
• Other suggestions or questions?